Lesson 685 of 1524
Understanding Money and Financial Institutions
What is money, what are its characteristics and functions, and what are the three parts of the U.S.
Practice this chapterWhat is money, what are its characteristics and functions, and what are the three parts of the U.S. Money is anything that is acceptable as payment for goods and services.
Businesses and government use money in similar ways. Both require money to finance their operations.
money — Anything that is acceptable as payment for goods and services. M2 — A term used by economists to describe the U.S. monetary supply. Includes all M1 monies plus time deposits and other money that is not immediately accessible. reserve requirement — Requires banks that are members of the Federal Reserve System to hold some of their deposits in cash in their vaults or in an account at a district bank. bank charter — An operating license issued to a bank by the federal government or a state government; required for a commercial bank to do business.
Be able to state Employees Credit Union, Raleigh, North Carolina.
Worked example
What does “money” mean in Understanding Money and Financial Institutions?
- 1Use the wording this chapter gives for money.
- 2The book says: Anything that is acceptable as payment for goods and services.
- 3Do not use the meaning of M2. That term means A term used by economists to describe the U.S. monetary supply. Includes all M1 monies plus time deposits and other money that is not immediately accessible.
Result: Anything that is acceptable as payment for goods and services
Why. That is the meaning this chapter gives for money.
Do not swap money and M2. money means Anything that is acceptable as payment for goods and services. M2 means A term used by economists to describe the U.S. monetary supply. Includes all M1 monies plus time deposits and other money that is not immediately accessible.
Practice margin
This chapter
A fresh set from this chapter only. Choose 10 or 20. Multiple choice and fill-in, with no repeat inside the set.